Bitfinex crypto exchange tests new AML compliance tool


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Cryptocurrency exchanges Bitfinex is preparing to test a new anti-money laundering (AML) tool on its platform.

The company announced on Wednesday that it would test a new solution designed to comply with the Travel Rule, an anti-money laundering and terrorist financing ordinance for financial institutions introduced in 2019 by the Financial Action Task Force (FATF) became.

Bitfinex has partnered with compliance startup Notabene to implement its software-as-a-service solution to identify digital asset accounts, track cross-border transactions and meet other comprehensive obligations of virtual asset service providers (VASP) . The integration will supposedly allow the company to maintain privacy while collecting and managing data on travel rules.

According to the announcement, the solution enables Bitfinex to share, send and receive counterparty information in addition to blockchain transactions to all counterparties using the same infrastructure. Bitfinex’s sister company, Tether, which operates the world’s largest stablecoin tether (USDT), has also started using the Notabenes solution.

Paolo Ardoino, Chief Technology Officer of Bitfinex and Tether, said that Bitfinex “has always taken a leading role in meeting new global regulatory requirements”.

Pelle Brændgaard, CEO of Notabene, told Cointelegraph that the company launched its Travel Rule solution in August 2020. The service currently processes transactions between at least 50 different exchanges including Paxful, Luno, Bitso, OnChain Custodian, and others.

Notabene has conducted tests in many countries, including a pilot project with the Financial Services Regulatory Authority of Abu Dhabi Global Market in early October.

“With this updated guide, the FATF is increasing the urgency, but also recognizing the real issues that VASPs and Travel Rule Service Providers pointed out last year. They now recommend that regulators be flexible during the initial rollout, ”said Brændgaard.

Related: Bank of Spain issues registration guidelines for crypto services

Brændgaard added that compliance with the Travel Rules has increased rapidly every quarter and the company expects the major VASPs to meet the requirements in the first or second quarter of 2022.

Since the release of the cryptocurrency travel rule more than two years ago, the FATF has continued to work on the framework to improve it and adapt it to the growing cryptocurrency industry. In February, the agency issued a review document to adjust its travel rule guidelines for stablecoins and crypto peer-to-peer transactions.